Have German Banks Reduced Their Exposure to Greek Debt?

By

Ulrike Dauer

Jun 10, 2011 8:34 am GMT

Have they or haven’t they? Since the beginning of the week, German media have been poring over the question of whether German banks really have cut their exposure to Greek sovereign debt in recent months.

If they have, it will question a pledge Deutsche Bank CEO Josef Ackermann and DZ Bank CEO Wolfgang Kirsch gave to German Finance Minister Wolfgang Schäuble in May 2010 not to reduce their exposure—a move to support Europe-wide efforts to rescue debt-ridden Greece.

On Tuesday, Spiegel Online reported that German banks only reduced their exposure by a small amount in 2010 compared with other European peers. In fact, it was reported that they had replaced French banks as the largest creditor of peripheral euro-zone sovereign debt.

Quoting figures from the Bank of International Settlements, Spiegel Online reported that German banks’ exposure to Greek sovereigns fell by only 2% between the first and the fourth quarters of 2010, while French banks shed 44% in that same period.

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